April 23 (Bloomberg) -- The cost of breakfast beverages are
poised to increase as coffee futures surge after a Brazilian
drought damaged crops, while orange-juice prices climb with
Florida’s output heading for a 29-year low.

The CHART OF THE DAY shows that an index comprising futures
in New York for arabica coffee and orange juice climbed
yesterday to a 25-month high of 378.1, jumping 51 percent in
2014. In the two years ended 2013, the gauge tumbled 37 percent.

To start this year, Brazil, the world’s top coffee and
citrus grower, faced the most-severe drought in decades. In
Florida, the second-biggest orange grower, a gnat-sized insect
spread citrus greening, causing fruit to wither and drop early.
Prices for bacon, eggs and milk have also climbed, and surging
meat and dairy are helping to spur the fastest gain in U.S.
consumer food costs since 2011, government data show.

“Brazil’s crops have been impacted more than we first
thought in the wake of drought conditions,” said Ross Colbert,
a global beverage-strategist at Rabobank International in New
York. “The greening issue is continuing to challenge growers,
increasing grove maintenance, and speculators are reacting to
that. We could begin to see higher prices for consumers in 30 to
60 days.”

On ICE Futures U.S. this year, arabica coffee has jumped 93
percent to $2.134 a pound, the biggest gain among 24 raw
materials in the Standard & Poor’s GSCI Spot Index. Orange juice
has climbed 17 percent to $1.6275 a pound. The Bloomberg index
of the beverages combines the two prices.